22.07.2016 - Volatility fell in anticipation statements of the Fed and the Bank of Japan
American stock indexes yesterday slightly corrected, but are still near historical highs. Strong influence on the trading dynamics still has corporate reporting. Optimism on the markets was supported by the data on existing home sales in the US, which rose to 5.57 million vs. expected 5.48 million in June. Today, it is worth paying attention to statistics on the manufacturing PMI in the US by Markit (13:45 GMT). Investors did not rush to build up positions ahead of the Fed statement next week that may lead to increased volatility. According to our estimates, the potential for further growth declined and we expect the fall in the medium term.
European stocks are consolidated around the previous close levels. It is worth noting that the ECB yesterday said about saving of monetary policy parameters. Thus, the interest rate on deposits was -0.40% and credit rate 0.0%. Today, have been published data on service and manufacturing PMI in the Eurozone, which totaled 52.7 and 51.9 respectively, against expected 52.3 and 52.1. It is worth noting that in the UK manufacturing PMI fell to 49.1 against 52.1 earlier. The risks associated with the exit of the UK from the EU will continue to put pressure on the indexes in the region and in this regard, we expect the fall in the medium term.
Markets in the Asia-Pacific region fell against the background of the negative end of the trading session in the US as well as in connection with the strengthening of the Japanese yen after the Bank of Japan head Haruhiko Kuroda denies intention to use "helicopter money" to stimulate the economy and inflation growth in the country. Data on the growth of the manufacturing PMI in Japan to 49.0 in July versus 48.1 in June was unable to change the mood on the market. On Monday, we should pay attention to the statistics on the trade balance in Japan. The main event next week will be a statement by the Bank of Japan on monetary policy. The probability of decline in the region's markets had grown significantly recently.